Procurement lobbying rules discussed during Crowne Plaza event

Getting New York's procurement lobbying rules wrong can kill a business, experts on the laws warned 60 Albany, N.Y.-area business people Jan. 18.

"It can shut you down," said Lisa Fox, the attorney in the Office of General Services charged with overseeing procurement laws. "Everyone needs to change how you do business."

The new laws, which include a section of state financial law as well as a section of state legislative law, govern the ways businesses seeking state work can interact with governments of more than 50,000 people and state agencies.

The bottom line is that contacts during the procurement process can only be made with designated agency representatives, Fox said.

"The backdoor is closed," she said.

The state financial law restrictions on business to state agency contacts begin when the state first advertises for a contract and end when the contract is awarded.

But another set of laws govern business contacts with government, as well as state agencies, said Steven Hensel, assistant counsel to the New York state Temporary Commission on Lobbying. This "legislative law" restricts contacts related to government procurement beginning with the period when the government determines it has a need for a good or service, even before a formal contract proposal is sought, Hensel said.

The law contains exemptions for sales people working on commission, and other exemptions which allow for a normal range of contacts between businesses and government officials at conferences and other events, Hensel said. But the bottom line is that when managers and corporate officials get involved in trying to push a sale once the process has started, they may be violating the law, Hensel said.

The morning session at the Crowne Plaza Hotel was sponsored by McKenna Long & Aldridge LLP's Albany office, the Albany-Colonie Regional Chamber of Commerce and the Independent Power Producers of New York.

A lot of his members have questions about the new regulations, so hosting the session was a way to clarify those issues, said Gavin Donohue, CEO of Independent Power Producers of New York.

In a relatively small, close-knit government town like Albany, these issues are especially tricky because so many people in business and government know each other personally, Donohue said. The law, for example, forbids giving gifts to government officials. Does that mean, Donohue said, he can't bring a present to a friend's wedding if that friend works for state government?

Gerald Jennings, McKenna Long's managing director of the firm's public policy group, emphasized that lobbying scandals in Washington, D.C., and in New York have made the public and press hypersensitive to lobbying issues. Even if a company does nothing illegal, the appearance of impropriety can do damage, Jennings said.

"At a minimum you don't want to be in the papers," he said. "At a maximum you don't want to be under investigation."

Stefan Passantino, a partner in McKenna Long's Atlanta office, pointed out that business people have to be concerned about more than just lobbying changes in New York. Every state is toughening up their regulations, Passantino said.

These changes are not consistent so companies doing business in other states could get confused.

Lynne Soltysiak, business relations manager for Office Max in eastern New York, said she came to the morning briefing because the company has lots of state government customers and she wants to make sure she doesn't step over the line. She's got a better idea now of how to do her job, without breaking the law, Soltysiak said.